Sargent compares libraries to Netflix: ‘How is that a good model for us?’

March 12, 2010 | 7:59 am

Macmillan’s CEO John Sargent attended the “Publishing Point” Meetup on Wednesday in NYC and spoke a little about the future of e-book lending, and the potential for publishers to create a new revenue stream from libraries. Eric Hellman attended the session and summarized Sargent’s argument on his blog:

“[E-book distribution by libraries] is a very thorny problem”, said Sargent. In the past, getting a book from libraries has had a tremendous amount of friction. You have to go to the library, maybe the book has been checked out and you have to come back another time. If it’s a popular book, maybe it gets lent ten times, there’s a lot of wear and tear, and the library will then put in a reorder. With e-books, you sit on your couch in your living room and go to the library website, see if the library has it, maybe you check libraries in three other states. You get the book, read it, return it and get another, all without paying a thing. “It’s like Netflix, but you don’t pay for it. How is that a good model for us?”

“If there’s a model where the publisher gets a piece of the action every time the book is borrowed, that’s an interesting model.”

Hellman and a few of his commenters note that Sargent’s views don’t align fully with the reality of library lending in the U.S. Most libraries don’t allow three-states-away lending, and most don’t have the budget flexibility to enter into royalty payment agreements with publishers. On a related note, the just-released 2009 Librarian eBook Survey reports that 38 percent of librarians say a pay-per-use model is unacceptable because it doesn’t work within planned budgets.

Additionally, I wonder if libraries provide a built-in protection against content piracy; if you want access to a book but can’t afford it, there’s a system in place where you can borrow and read it without resorting to physical theft or pirated downloads.

Comments:

In some countries, a special tax is assessed so as to provide royalties to authors when their works are checked out of the library. It’s nice to see Sargent has his priorities straight: those royalties really ought to be going to publishers.

I’m in the minority that agree with Mr Sargent on this. I don’t see why the libraries have to replicate the paper book model for ebooks. It should be easy for them to count how many times each book was borrowed and compensate the rights holder, rather then trying to estimate how many they want to lend concurrently.

It’s a fair model but it would require the libraries to make tough decisions. Their budget might not allow them to lend new first release best sellers to everyone. The public might have to decide who would get “platinum library cards” that would allow them to borrow first release best sellers. For example maybe people under 18 and over 65 would be given platinum cards.

Combined with changing the copyright back to something manageable like 14 years I think it could work.

I know that I’m in the minority though so I don’t expect it to happen.

That’s just absurd. The whole point of libraries is to lend books free of charge. And to expect libraries to afford what I suspect most publishers will be wanting to get from these loans is to completely ignore under how much budget restraint most libraries find themselves.

Maybe publishers could work along with libraries to register ebook readers and market specific ebooks and paper books straight to them, based on what books these people loan. Free market research! (Although I suspect that information is confidential, so it should be the reader’s choice wether to register or not. Maybe publishers could make the choice to register more appealing by offering discounts on ebooks you loaned and liked)

Sargent just keeps giving me reasons not to trust him with ebook prices…

To answer the question, yes libraries that “lend” ebooks actually subscribe to services such as Overdrive, NetLibrary, ebrary or others that wrap the ebooks in DRM to enforce publisher mandated restrictions. And sure, any DRM can be circumvented, and it’s really annoying, but that friction is a price that we currently have no alternative to.

I don’t know whether that’s sustainable or whether patrons will accept it. I don’t think Macmillan currently works with any of the library ebook providers. But I think there are many models that could work better that aren’t currently being explored because too many people have blinders on.

Sargent might also ask himself who benefitted by the Netflix innovation (and who lost out). I certainly wasn’t out buying copies of all those movies that caught my interest before there was such a thing–I just didn’t watch them. Or look at the flip side: here are all these people who already go to the library: whose books will they find there?

“If it’s a popular book, maybe it gets lent ten times, there’s a lot of wear and tear, and the library will then put in a reorder.”

Do pbooks really only last a library through 10 lendings? Somehow I think they last longer than that (even MMPB’s).

That said if necessary I don’t see why they couldn’t “buy” a book for a certain amount of checkouts (maybe 30 or 40?) and then have the book ‘go dead’ and need to be repurchased if it’s still popular enough for the library to want it on their “shelf”. Maybe not ideal from some points of view, but I can see the publishers side of it too.

I just looked up a book I knew had been our for a while and would have circulated quite a bit. Amber Beach by Elizabeth Lowell came out in 1997, and the copy in our library has circulated 62 times. John Grisham’s The Firm, from 1991, has been circulated 118 times. Tom Clancy, Clear and Present Danger, the current copy has circulated 60 times. Our other copy of The Firm is paperback, it’s circulated 65 times. Tamar Myers mystery The Ming and I, also MMBP has circulated 53 times.

We’ve got an Earl Stanley Gardner book, The Case of the Daring Divorcee, from 1964 that’s still on our shelves and circulating, 53 times since 1999 when we changed circulation systems and lost all the previous data.

All of that is just a really long way of saying John Sargent’s crazy. Yes library books get damaged or destroyed and have to be replaced, but not to the extent that he seems to think.